Insight
Parametric insurance: A captivating solution
Parametric policies, which pay based on the magnitude of an event, can bridge coverage gaps that are difficult to insure with a traditional indemnity policy.
Among the various care delivery models that exist, direct primary care (DPC) is gaining traction among self-funded employers. DPC provides primary care services outside of a major medical insurance benefit and is not administered by a third party. In this white paper, we discuss the common key features of DPC offerings. We also present an actuarial perspective on claims for a midsized employer that implemented a DPC point solution in its self-funded medical benefit. We compared utilization and cost outcomes for about 900 members enrolled in DPC to the same outcomes for about 1,100 members not enrolled in DPC during a two-year period. A discussion of implications for employers follows, along with key considerations, such as program objectives, clinic placement, benefit design, operational effectiveness, and financial results.
Insight
Parametric policies, which pay based on the magnitude of an event, can bridge coverage gaps that are difficult to insure with a traditional indemnity policy.